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Real Estate Agents Underpaid?

I just read an article that ranked real estate agents as one of the most underpaid professions and I just wanted to vent about it.

Real estate agents are underpaid??? Really?? They are the most overpaid people ever. They are glorified door openers who add no value to real estate transactions. When we were shopping for a home almost every single agent sitting at the open houses knew next to nothing about the home they were "selling". We found the home we're living in, on our own and only used a buyer's agent to close the deal because he offered a rebate. Otherwise, that full 6% would have went to the seller's agent. My buyer's agent didn't know anything about any of the homes either and we basically paid him $6500 to unlock doors for us. If that isn't overpaid, I don't know what is. On the flip side, we paid a flat fee of $400 to list our home on the MLS exchange and sold it in 3 weeks. The people coming through our home kept telling us how refreshing it was to be able to ask the owners questions because the agents at most open houses were clueless. The young couple that did finally buy our home found our home online on their own too, but because they had an agent, we had to pay another 3% to him to close the deal. I really wish the government would crack down on this whole realtor monopoly.

By the way, I also understand that the individual agents don't necessarily get that full 3% or 6% because they split it with the broker and so forth. However, that doesn't mean the consumer pays less. My point is, as a consumer or seller, I get little to no value proportionate to the amount of money that is being paid out. They certainly aren't a slickdeal when it comes to home purchasing.

Some agents are overpaid, some may be underpaid. I was very happy with my agent. Did he get a shitload of money from my sell and buy? You betcha! Did he earn $38k (his 3%)? Almost certainly not! But it is what it is.

The MLS is a criminal organization. It has a lot of influence. The MLS isn't going anywhere so nothing will change.

E finita la cuccagna

Liberals want you to think like them, Conservatives just want you to think!

We just bought our house in Texas less than a month ago. I will tell you, I feel our agent was greatly underpaid. He worked with us a solid 2 months, we saw 28 houses in one weekend, and spent weeks negotiating the pricing and repairs. After all of his expenses, his gas driving us around, the unlocking subscription service he has to pay for, an his rent at his brokers office.. I think he came out below what he deserved. We plan to make this up to him by buying him drinks, and referring everyone we can to him.

On the other hand, the sellers agent we used to sell the house in Ohio was WAY WAY overpaid for what he did. He never showed the house, he never did any advertising, and he did not help us with any negotiations. His answer for everything was... well that seems fair sign this. He got paid quite a bit for what he had to do.

I think it depends the market. In my area most all houses are 180k and up. You can make a decent living off selling just a few houses a month.

However, in other markets where houses can be had for 40-50k all day, theres not much to get in terms of profit. Granted the cost of living is also lower down there, but I don't think its proportionate.

I suppose it depends on the agent, but considering how much buyers usually jerk around the agents, I can certainly understand the view that they are underpaid. If you drove all over creation, spending day after day carting someone around (or even meeting them), spending hundreds in gas and racking up the miles on your car, only to have them never purchase a home, I'm sure you'd feel you were underpaid as well.

If both parties willingly agreed to the transaction knowing how much the agent's commission would be, the agent is neither underpaid or overpaid - they were paid exactly what both parties willingly agreed to. However, if force or fraud were involved, then being underpaid or overpaid is certainly a possibility.

How many hours would you estimate your buyer's agent spent actually working on finding you a home and closing the deal? Also, how much in commission is he getting for his work?

I just bought a home and at the time it did feel like we were just abusing the crap out of our agent. We had him take us to see at least 25 houses which we found online on our own over a two week period . However, when I look back at how much time he spent doing that plus how much time he spent helping us negotiate several counter offers, it came out to a maximum of maybe 40 hours of actual "work". I am including the drive between homes when we went on the tours and the time he spent reading a magazine during the inspection. Since he is also the broker he actually gets to keep the full 3%. This translated into about $6500 commission net after rebate on a $272k purchase. Keeping in mind, a majority of the time he spent actually "working" consisted of driving from house to house and unlocking doors. All in all, the agent made about $163/hr (half that if he weren't the broker too). How many people do you know get paid $163/hr to drive around in a car and unlock doors? Probably a lot since there are way too many realtors in the world.

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from Stubbs4Prez
:

We just bought our house in Texas less than a month ago. I will tell you, I feel our agent was greatly underpaid. He worked with us a solid 2 months, we saw 28 houses in one weekend, and spent weeks negotiating the pricing and repairs. After all of his expenses, his gas driving us around, the unlocking subscription service he has to pay for, an his rent at his brokers office.. I think he came out below what he deserved. We plan to make this up to him by buying him drinks, and referring everyone we can to him.

On the other hand, the sellers agent we used to sell the house in Ohio was WAY WAY overpaid for what he did. He never showed the house, he never did any advertising, and he did not help us with any negotiations. His answer for everything was... well that seems fair sign this. He got paid quite a bit for what he had to do.

Interesting perspective as I haven't thought of it like that. What are your thoughts on the Kardashians making millions for being trashy in front of TV camera? As long as someone is willing to pay them the millions then by your logic they are not overpaid?

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from Brian1
:

If both parties willingly agreed to the transaction knowing how much the agent's commission would be, the agent is neither underpaid or overpaid - they were paid exactly what both parties willingly agreed to. However, if force or fraud were involved, then being underpaid or overpaid is certainly a possibility.

As part of my job in IT, I am constantly working with people who are less technical which can be quite frustrating at times. If I made $200/hr, should I consider myself underpaid because there are unpleasant or unenjoyable parts of my job?

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from 420
:

I suppose it depends on the agent, but considering how much buyers usually jerk around the agents, I can certainly understand the view that they are underpaid. If you drove all over creation, spending day after day carting someone around (or even meeting them), spending hundreds in gas and racking up the miles on your car, only to have them never purchase a home, I'm sure you'd feel you were underpaid as well.

But let's use your example anyways. We recently sold our home on our own using a flat fee listing service and put in roughly 30 hours worth of work acting as our own seller's agent. More than half of that was spent hosting 4 open houses. We obviously went way above and beyond and spent more time on selling our home than a normal seller's agent would have. So in my extreme example, let's pretend we had a super ambitious agent that spent a total of 30 hours selling a $40k home. If he were a broker/agent, he would have made $40/hr and half that if he was just an agent. Since when is $20/hr or $40/hr at the LOW end of a pay scale for a profession considered underpaid?

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from nizzy1115
:

However, in other markets where houses can be had for 40-50k all day, theres not much to get in terms of profit. Granted the cost of living is also lower down there, but I don't think its proportionate.

Seriously, you seem to have a real problem with Realtors from the way you talk..

In our case, our Realtor got 1.5% of the selling price (Less than 200k). His company got 1.5% and the sellers agent got 3% (not sure how that broke down between what his company took).

As for how much work he put into our purchase, we gave him a list of 5 houses we wanted to see and he provided us a list of 25 more he thought we might like and were in our price range. He then spent 8 hours a day with us for 3 days straight looking at houses. He ended up writing the purchase agreement and then we had about 12 revisions to it over the next month (due to the sellers agent). He spent time getting our home inspection taken care of, and was here with the inspector. He got the exterminator taken care of, worked with our mortgage broker getting financing taken care of, and even stopped by on our move in day to lend a hand.

But what makes me think he was underpaid was that in the end he took care of everything, we got the house we dreamed about, and he still calls me checking in to see if we need anything.

But like I mentioned before... the agent we used to sell our house... way over paid for what he had to do.

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from laier19usa
:

How many hours would you estimate your buyer's agent spent actually working on finding you a home and closing the deal? Also, how much in commission is he getting for his work?

I just bought a home and at the time it did feel like we were just abusing the crap out of our agent. We had him take us to see at least 25 houses over a two week period which we found on our own online. However, when I look back at how much time he spent doing that plus how much time he spent helping us negotiate several counter offers, it came out to a maximum of maybe 40 hours of actual "work". I am including the drive between homes when we went on the tours and the time he spent reading a magazine during the inspection. Since he is also the broker he actually gets to keep the full 3%. This translated into $8250 commission on a $275k purchase. Keeping in mind, a majority of the time he spent actually "working" consisted of driving from house to house and unlocking doors. All in all, the agent made about $206/hr (half that if he weren't the broker too). How many people do you know get paid $206/hr to drive around in a car and unlock doors? Probably a lot since there are way too many realtors in the world.

This Thread is more than 766 days old. It is very likely that it does not need any further discussion and thus bumping it serves no purpose.If you still feel it is necessary to make a new reply you may do so.
I am aware that this Thread is rather old but I still want to make a reply.

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